Vallejo's Shadow Government

Shadow government. Secret committee. Backroom deal. Clandestine. These are words that swirl around MISEDC, the ad-hoc committee created by Councilmembers Malgapo and Dew-Costa in April, 2014. MISEDC is an acronym for Mare Island Straits Economic Development Committee, with the stated goals of finding ways to seek federal funding for the dredging of the Mare Island Straits; and exploring how Mare Island Straits could be transformed into an economic driver for the City of Vallejo.

Why so much vitriol over such lofty goals? Perhaps the fact that this ad-hoc committee was founded improperly, if not outright illegally, may have a lot to do with it. To use former mayor Osby Davis’ own words, “They (referring to Councilmembers Malgapo and Dew-Costa, who were later joined by Verder-Aliga) did not even have the right to create an ad-hoc committee according to Municipal Code ... “ According to the Vallejo Municipal Code, only the mayor has the authority create a council ad-hoc committee. MISEDC, therefore, was created in clear violation of the Municipal Code, was unsanctioned, and undermined the ongoing General Plan Update.

Malgapo and Dew-Costa assembled an impressive line-up of members, albeit behind the backs and without the knowledge of 3 other council members who were not supported by JumpStart. Membership included representatives of US Congressman Mike Thompson, State and County politicians, and business “stakeholders” who have interest in getting dredging resumed. Most notable members were the principals of VMT and Orcem, entities with a pending joint project application with the City that will ultimately be judged by the City Council.
Did MISEDC’s members know that they were in an unlawfully-formed, rogue ad-hoc committee? Likely not, but Councilmembers Malgapo, Dew-Costa and Verder-Aliga clearly did. Their use of their personal email accounts while conducting committee business is a good indication that they were trying to hide something.

The Mare Island channel was regularly dredged by the US Army Corps of Engineers when the Navy was operational here. This stopped when the Navy left, and in 1999, the City requested the Corps to resume dredging. That request was denied because of lack of economic activities that required the desired depth on the channel. So this time around, for MISEDC to be successful in meeting its goals, the ad-hoc committee has to prove that there is now a significant increase in maritime traffic that would justify dredging.

Here’s where the relationship among VMT/Orcem and Councilmembers Malgapo, Dew-Costa and Varder-Aliga effectively transformed into an alliance. MISEDC needed VMT/Orcem’s estimated 2 million tons of annual throughput to justify dredging to the US Army Corps of Engineers. VMT/Orcem, on the other hand, needed the support of these council members to approve their project. Quid pro quo.

Mr. Malgapo even actively advocated for the applicants. In a 4/27/15 email to Kathleen Diohep, then a City employee, he wrote: “There will be a meeting on 5/1/15 at 10:00 a.m. at Dan’s Office (referring to Dan Keen, City Manager at that time) at my request. Concerns raised by applicants, not with your department, but mostly around EIR/CEQA so meeting will include Andrea. I’m also nervous. This project is like a square peg we are trying to fit into a square hole. It is such a perfect project for this particular site. It will be a sad day for our city if we can’t bring this project to fruition. It will certainly hurt MISEDC Goals.”

The public caught wind of MISEDC only by happenstance, when Mr. Steve Bryan, President of Orcem, inadvertently disclosed its existence during a South Vallejo open forum. It resulted in intense public outcry that led to a Brown Act violation hearing, and the ad-hoc committee eventually getting disbanded.

MISEDC was in existence for approximately 19 months, and during that period it successfully submitted a request to the US Army Corps of Engineers, through a letter signed by Dan Keen, the City Manager, to conduct an evaluation of the feasibility of dredging the Mare Island Strait. This evaluation reportedly cost taxpayers $20,000.00. In that request, Mr. Keen specifically cited the projected 2 million tons of VMT/Orcem annual throughput to help justify dredging the channel.
Here’s where things got really strange. After they were exposed, and in an attempt to play down their alliance, both Mr. Malgapo and VMT/Orcem denied that the applicants actually needed the dredging that they have heavily lobbied for. In their Facebook page, Orcem Vallejo posted: “VMT doesn’t need Army Corps of Engineers dredging, as you will see if the project proceeds. The channel in front of VMT is actually getting deeper from natural scouring.” At the Brown Act hearing, Mr. Malgapo said, “They (referring to VMT/Orcem) could care less if we dredged or not. They’re in the deepest part of the channel.”

So if VMT doesn’t need dredging by the US Army Corps of Engineers, why then did MISEDC, through the office of the City Manager, use the projected throughput of VMT as major justification for the feasibility study? VMT traffic, geography indicates, will end at the mouth of the river, and their ships won’t need the upstream channel that MISEDC wants dredged. Was it deceptive representation when they cited the 2 million metric tons of throughput? Was this a conspiracy to mislead a government agency, resulting in expenditures of taxpayer funds? These are questions that beg to be answered, preferably through an independent and thorough investigation.